The nickel price is currently at $25,400(usd) per tonne with the currency representing $0.67(aud) which equates to $17.19(aud) per pound. (Global inventories are at record lows and the EV, green energy revolution is dominating headlines).
We are part of a small group of miners who actually produce nickel and the project is currently in ramp-up phase slated for nameplate by the end of FY23 (8 months away). Notwithstanding expansion of our resources (aka mine life) which I understand will be upgraded in October.
Even if we use the FY23 guidance provided to the market by Panoramic and work from the current spot price then we are estimated to make $115m gross.
Yet our share price is at $0.20 a share ($410m market cap). Even explorers have bigger market cap’s than Panoramic and our producing competitors have market cap’s that dwarf ours.
This makes no sense.
Yes we have buyers and sellers but to assume that suppression and manipulation does not exist in the share market is respectfully ignorant.
IGO attempted to acquire Panoramic in November 2019 for a measly $312m(aud) which was rejected by board/ shareholders as ambitious and undervalued. IGO has since acquired WSA knowing it would also assume a blocking stake (21%) in Panoramic and give itself an option to additional assets/ business/ resources. Scott th Ratbag has raised valid points regarding suppression given the structural circumstances at play here.
If the share price is indeed being suppressed then (in my view) you can only attempt to manipulate Panoramic’s share price on market but ultimately the shareholders will decide what the business is really worth. If IGO was prepared to pay $312m(aud) in November 2019 when nickel prices were about $13/14k per tonne and the business operations at the time in care & maintenance while almost insolvent then believe me, today’s Panoramic is worth a lot more. (As I understood, even WSA’s independent report had Panoramic valued between $0.33 and $0.52 a share) (I think using $19.5k per tonne).
Also, If WSA can achieve an offer for $1.3b which had similar revenues/costs (does not include resources) then this should also be used as a reassuring benchmark.
Ausbil (now a substantial holder of Panoramic) also paid an average of $0.27/$0.28 for its recent purchase. A leading fund clearly sees value and expects the share price (trading or acquired) to exceed the said buy-in price in my view anyways.
Let us see how this all plays out and I wish all the shareholders great outcome here
PAN Price at posting:
20.0¢ Sentiment: Buy Disclosure: Held
(20min delay)